Many healthy aging parents have no coverage for a simple reason: it’s just not a concern. But if the need for long-term care moves from being a remote possibility to a reality, the financial burden could be significant. Making sure your parents have long-term care insurance can be one of the smarter financial moves you can make.
The costs of an extended-care facility or in-home care can quickly deplete finances. Adult children may then be required to help pay the expenses, negatively affecting their finances, and perhaps their own family’s standard of living.
It’s best to purchase long-term care coverage before age 65 — the earlier the better. Not only will the cost of premiums be lower, purchasing coverage early will also eliminate the possibility that parents will later suffer health issues that could disqualify them from coverage. Most insurers allow the purchase of long-term care insurance up to age 80, although at this age you’ll have to carefully weigh the much higher costs of coverage versus the benefits.
If your aging parents are without long-term care coverage, talk to them about why they might need it. If they’re not in a position to pay the premiums, it might be wise to share the cost or to purchase insurance on their behalf.
We can help you determine whether it makes sense to purchase long-term care insurance for your parent or another relative.
Ealine Kautz, CFP
Credential Financial Strategies Inc. is a member company under Credential Financial Inc., offering financial planning, life insurance and investments to members of credit unions and their communities. ®Credential is a registered mark owned by Credential Financial Inc. and is used under licence.
When my family found out how expensive it would be to place mother in a care facility, we had some serious decisions to make. She had no money, and we, her kids, didn't have enough to help her out. She moved in with me and my family. It was a challenge and meant many changes for all of us, but in the end it was well worth it. It taught my kids about the importance of caring for family, they grew closer to my mother, and I got to know her as a person, not just my mother.
ReplyDeleteFinancially it would have been nice to be able to provide a mother-in-law suite with its own bathroom and kitchen. Would long-term care coverage have helped cover building my mother her own room?
Long-term care coverage is designed to provide a monthly benefit to the insured and doesn't require the insured to be admitted to a long-term care facility so this could have helped with your monthly costs. Some Critical Illness policies cover 'loss of independent living' which is the inability to perform 2 of the 6 activities of daily living (bathing, dressing, toileting, transferring, continence, eating). This type of policy pays a lump sum amount up front so funds could have been used toward renovating your mother-in-law suite. I hope this helps! Elaine
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